HOME BUYER GUIDE
Can't Afford to Buy Where You Live? Why More First Home Buyers Are Rentvesting Instead
February 26, 2026
The great Australian dream of owning your home hasn’t disappeared, it’s just taking a detour.
With median house prices in major cities now exceeding eight times the average household income, and a standard 20% deposit taking over a decade to save in most capitals, a growing number of first home buyers are rewriting the rulebook. Their strategy? Rentvesting.
What Is Rentvesting?
Rentvesting means buying an investment property in an area you can afford, while continuing to rent in the suburb you actually want to live in.
It’s not giving up on homeownership. It’s getting smarter about how you enter the market.
Instead of waiting years to save for a property in your preferred postcode, you purchase where the numbers work, often in an outer suburb, a regional hub, or even interstate, and let that investment build equity while you rent closer to work, family, or lifestyle.
Why It's Growing Fast
More than 54% of Australian first home buyers are now considering rentvesting as their path into the market , a 4% jump from the previous year, according to Westpac’s 2025 Home Ownership Report.
The numbers behind this shift are stark. In 2024, the Australian Bureau of Statistics recorded 8,283 new home loan commitments by first home buyers for investment purposes, a 12% increase on 2023. By comparison, owner-occupier first home buyer loan commitments grew just 5% over the same period.
Put simply: more first home buyers are choosing to invest before they own. And it’s not a backup plan — it’s becoming the primary strategy.
The Real Advantages
You get into the market sooner. In property, time in the market matters enormously. Waiting until you can afford your dream suburb could mean missing years of capital growth.
You live where you want now. Rentvesting lets you stay close to your job, social life, or family — without being financially locked into a postcode you can’t afford to buy in.
Your tenants help carry the cost. Rental income from your investment property offsets your mortgage repayments, making it more manageable than carrying a home loan alone.
You build equity while renting. Rather than saving idly in a bank account while prices rise, your investment property is working for you in the background.
What to Watch Out For
Rentvesting isn’t without trade-offs, and going in with clear eyes matters.
First Home Owner Grant eligibility — Most state grants and schemes require you to live in the property, so rentvesting may mean missing out on certain incentives. It’s worth checking the current rules for your state before making a decision.
You’re still paying rent — While your investment property builds equity, you’re covering rent where you live plus investment property costs. Cash flow planning is essential.
It requires a clear exit strategy — Rentvesting works best as a 3–7 year bridge, not an indefinite arrangement. Whether you plan to sell and roll the gains into your dream home, or use equity to buy your principal residence later, know your endgame before you begin.
Is Rentvesting Right for You?
That depends on your financial position, lifestyle, and long-term goals. For some buyers, it's the clearest path into the market right now. For others, a different approach, like using government schemes, guarantor loans, or targeting an affordable first home to live in, might make more sense.
At BBA Property Advocates, we help buyers navigate exactly these decisions. We’re not here to push one strategy, we’re here to understand your situation and find the approach that actually works for your life and your finances.
Let’s talk.
Ready to Explore Opportunities?
Let's discuss how these market insights apply to your investment goals. Book a consultation to get personalized advice on property opportunities.
Stay Informed, Buy Smarter
Explore more insights with our blog articles below.
2026’s Smartest Small Space Design Trends – Making Every Inch Count
February 17, 2026
No Comments
Read More »
The 3 Simple Changes That Will Make Your Home Feel Like a $2M Property
February 2, 2026
No Comments
Read More »